Spectral Diagnostics Inc., has announced its financial results for the second quarter ended June 30, 2011.
Second Quarter Highlights:
• Continued to effectively manage its U.S. pivotal trial for Toraymyxin, a therapeutic hemoperfusion device that removes endotoxin from the bloodstream. The EUPHRATES trial is targeted to enrol approximately 360 patients at 30 U.S. and international sites over a period of up to 30 months, with interim results expected at the midpoint of the trial by the end of 2012;
• Announced that 15 carefully chosen clinical sites for the EUPHRATES trial are operational, enrolment in the Company's Phase III sepsis trial is underway and, subsequent to the quarter end, the U.S. FDA approved an additional 15 U.S. or international sites for the trial;
• Jointly announced, with Medwell Capital Corp. (TSX-V:MWC), an agreement whereby, pursuant to a plan of arrangement, Medwell will acquire a further 33,333,333 Spectral shares for $10 million, at a subscription price of $0.30 per share. Pursuant to the arrangement, Medwell will also distribute 54,282,834 Spectral Shares to its shareholders, thereby reducing its ownership position in Spectral from approximately 45 % to 13.4 %;
• Concluded the reporting period with approximately $12 million in cash and short term investments.
"Our capital markets initiatives in the second quarter, together with the recently approved increase in the number of clinical trial sites, will provide funds for our expanded clinical development activities and help us complete our Phase III EUPHRATES trial on a timely basis" said Dr. Paul Walker, President and CEO of Spectral Diagnostics.
Dr. Walker continued, "There are few therapeutic treatment options available for the more than 250,000 patients diagnosed with severe sepsis and septic shock in the U.S. each year. Our trial is focused on reducing the very high mortality rate associated with septic shock."
The second quarter ended June 30, 2011 was the Company's second reporting period under International Financial Reporting Standards (IFRS). As anticipated and disclosed in the fourth quarter of 2010, the transition to IFRS had no material impact on Spectral's second quarter financial results.
Revenues for the three months ended June 30, 2011 were $691,000 compared to $685,000 for the same period in 2010. For the six months ended June 30, 2011, revenues were $1,313,000 compared to $1,510,000 for the same 2010 period.
Revenues were lower in the first six months of 2011 primarily due to a decline in sales of the Company's EAA™ diagnostic and related instrumentation resulting from the expiry of certain distribution agreements in 2010. All significant previously expired contracts have now been renewed.
For the three months ended June 30, 2011, the Company reported a loss of $1,700,000 ($0.02 per share), compared to $1,291,000 ($0.02 per share) for the corresponding period in 2010. For the six months ended June 30, 2011, the Company reported a loss of $3,158,000 or ($0.04) per share, compared to a loss of $3,231,000 or ($0.06) per share for the corresponding period in 2010.
Cash, cash equivalents and short-term investments on hand at June 30, 2011 were $12,070, compared to $15,332 at December 31, 2010. Cash was used during the six month period ended June 30, 2011 to fund operations and for working capital purposes.
The total number of shares outstanding for the Company was 80,550,061 as at June 30, 2011.